FCC Move Would Force Tribune Co. to Sell Connecticut Properties

Can Keep Either Two TV Stations or 'Hartford Courant' -- but Not Both

WASHINGTON (AdAge.com) -- Federal Communications Commission Chairman Kevin Martin hung out a "for sale" sign for the Tribune Co. when he announced his media ownership proposal yesterday. The good news for Tribune is the sign probably goes up only in Hartford, Conn.,where two TV stations or more likely the Hartford Courant would have to be sold.
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Mr. Martin, who advocates a limited easing of newspaper-broadcast cross-ownership, effectively put the agency on schedule to complete not only action on media ownership but a review of the Tribune's $8.2 billion buyout by investor Sam Zell and an employee stock-ownership group by year's end.

"It clears the brush for Tribune to go through," said Blair Levin, a former FCC official who is now an analyst for Stifel, Nicolaus & Co.

Ran into problems
The Tribune buyout has already won Justice Department approval, but ran into problems with the FCC cross-ownership rule that Mr. Martin now wants to alter.

Under the current rule, once the Tribune sells its stations and newspapers in Los Angeles, New York, southern Florida and Hartford, Mr. Zell cannot own TV stations in those markets. Tribune's ownership of the Chicago Tribune and WGN-TV and WGN-AM happened before the cross-ownership rule took effect and is exempt. Consumer groups and a church group have argued that some of the Tribune's stations are in clear violation of the rule and filed a lawsuit challenging the FCC's continuation of the broadcast licenses.

Mr. Martin's changes today would provide a path to resolve some of issues in cities in the top 20 markets.

In Los Angeles, ownership of the Los Angeles Times and KTLA-TV would be possible. In New York, ownership of Newsday and WPIX-TV would be possible. In southern Florida, ownership of the Sun-Sentinel in Fort Lauderdale and WSFL-TV in Miami would be possible. That leaves Chicago and Hartford.

Under the proposed new rule, Tribune could still own a single broadcast property in Chicago, but not two. The proposed rule, announced by Mr. Martin yesterday, allows some waivers to be granted and Mr. Martin told reporters he would look favorably on requests coming from properties that had been grandfathered in for more than 25 years.

'Sympathetic' to grandfather provisions
"I would be sympathetic to original grandfathers put in place in 1975," he said.

So that leaves Hartford, which isn't one of the country's top 20 cities and where Tribune has the Courant and two TV stations, WTIC-TV and WTXX-TV.

Mr. Martin left little doubt about his opinion of what happens there.

"I anticipate that [the rule's] application to Hartford would require them to divest," he said.

A Tribune company official declined comment, but the company and newspaper publishers may yet move to loosen the proposal or challenge the constitutionality of any cross-ownership limit in court.